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Local PE prices firm up on higher upstream costs
In China, the local PE market began to change direction this week following three consecutive weeks of declining prices, as stronger upstream costs and higher LLDPE futures prices persuaded distributors to lift their offers by around CNY100-250/ton ($15-38/ton) on the week. The increases witnessed in the local market were mostly concentrated at the lower end of the range as producers generally left their offers unchanged on the week.  Import LDPE and HDPE film prices recorded some slight declines at the upper end of the range this week while LLDPE film prices witnessed no changes over the past week, with the overall import ranges for both dutiable and non-dutiable origins standing at $1580-1650/ton for LDPE film, $1240-1300/ton for HDPE film and at $1320-1450/ton for LLDPE film, all on a CFR China, cash basis.  Buying interest was reported to be scarce this week as the approach of the year end period combined with speculation that China’s Central Bank will announce another interest rate increase in the days ahead caused most buyers to delay their purchases whenever possible.

Spot PE prices are expected to remain mostly steady over the short term as most players are taking a wait and see approach to the market.  Although higher upstream costs, which have pushed import HDPE film offers below the theoretical breakeven level based on spot ethylene prices, are putting some upward pressure on PE prices, buyers’ general unwillingness to purchase along with expectations of further monetary tightening measures by the Chinese government have mostly balanced out the effects of rising costs.

NYMEX crude settled on Wednesday at $88.28/barrel.
Feedstocks & Monomers
Feedstocks
Week No
Crude Oil Nymex USD/bbl
Naphtha CFR-Japan USD/mton
Naphtha CIF-NWE USD/mton
10-49
89
846
834
10-48
86
814
812
10-47
83
786
767
10-46
83
798
775
10-45
87
801
788

Ethylene
Week No
CFR-FEA USD/mton
FD-USG USD/mton
FD-NWE USD/mton
10-49
1170
1060
1200
10-48
1110
1120
1180
10-47
1010
1090
1250
10-46
980
1150
1270
10-45
980
1160
1280
 
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